May 12 (Bloomberg) -- Elliott Management Corp., the hedge
fund founded by billionaire investor Paul Singer, won support
from a former official in President George W. Bush’s
administration as it seeks payment on bonds Argentina defaulted
on in 2001.

Kenneth Dam, who was deputy U.S. Treasury secretary under
Bush, urged the U.S. Court of Appeals in New York last month to
uphold rulings directing Argentina to settle in full with
Elliott’s NML Capital unit when it makes payments on bonds
issued in 2005 and 2010 restructurings. The court is scheduled
to hear oral arguments on the appeal the week of June 18.

Dam’s “friend of the court,” or amicus, brief follows one
filed in April on behalf of the Argentine government by the U.S.
Justice Department, which said lower-court rulings in favor of
NML’s so-called pari passu argument could hurt other
restructurings by rewarding investors who hold out while
punishing participants.

“Elliott is presumably trying to offset the Justice amicus
brief by bringing in a former Treasury official,” said Mark
Weidemaier, a law professor at the University of North Carolina
at Chapel Hill who conducts research on international financial
contracts.

NML Capital has won five judgments totaling $1.6 billion
and has six other lawsuits pending judgment, according to court
filings. The fund has yet to receive any payout from its
Argentina-related court awards.

Dam wrote in his brief that collective action clauses,
which allow a defined majority of bondholders to impose debt
restructuring terms on all bondholders, have eliminated the
threat from holdouts.

“The U.S. expresses concern in its brief that the district
court’s ‘equal treatment’ interpretation of the pari passu
clause will negatively affect the ability of countries to
restructure their debt,” Dam wrote. “Given the widespread
prevalence today of collective action clauses -- about 83
percent of the presently outstanding bonds of foreign sovereigns
issued under New York law contain them -- this concern has no
real basis.”

Solicitor General

Dam, now a professor emeritus at the University of Chicago
Law School, has also held positions in the U.S. State Department
and the White House Office on Economic Policy, according to his
filing. Former Bush U.S. Solicitor General Theodore Olson, now a
lawyer at Gibson Dunn & Crutcher LLP, is representing Singer’s
fund before the appeals court.

Dam didn’t return a phone message and e-mail sent to his
law school office seeking comment on the filing. Peter Truell, a
spokesman for New York-based Elliott Management, declined to
comment.